"The cannabis sector is still in its infancy and primed for growth as legislation to control and legalise certain aspects of usage is developed," Distell CEO Richard Rushton said in a statement, adding that the investment was in line with its strategy to explore new expansion opportunities.
The price for the stake in RETHINK, created by herbal and organic pharmaceuticals firm Releaf Pharmaceuticals, was not disclosed. Invenfin, the venture capital arm of Distell's largest shareholder, Remgro, also took a 20% share in RETHINK.
Distell and Invenfin said their partnership with Releaf Pharmaceuticals could produce a range of CBD brands and market leadership both in SA and other major markets. Distell said this included but was not limited to CBD-infused drinks.
Distell is currently grappling with the impact of a ban on alcohol in the country, the third to be implemented since March last year as part of coronavirus restrictions. But hefty investments made in prior years have helped its recovery, it said last year.
It has been legal to sell CBD products in SA since 2019.